Newcastle Building Society - 5%, 5 year ISA (NOW CLOSED)

Steve_xx

Hungerdunger wrote: »

Just a note of caution: The website says "Withdrawals are permitted". It doesn't say anything about transfers.

Obviously, you could withdraw your funds to benefit from a higher interest rate elsewhere, but then you'd lose the tax-free status on the money.

Excellent point. This needs clarification from the Newcastle.

Steve_xx

I have also noted term 7:

• 7. On maturity the account will automatically transfer to the Newcastle's designated maturity account. We will write to you prior to maturity to advise you of any amendments to the Terms & Conditions of your account. Following the day of maturity you have 28 days in which to withdraw funds penalty free, thereafter the maturity account Terms & Conditions will apply.

This kind of infers that the cash could lose it's tax free status at the end of the period, ie if it is swept into a non ISA account. I don't much like the sound of that, and I'm not keen on the talk of the possibility of amendments to the terms and conditions. Again the word "withdrawal" is used and the word "transfer" is absent. I think there needs to be some clarification here.

Jonbvn

I sent an online query to the Newcastle BS this morning regarding transfers and the status of the ISA at maturity.

This is the email I just got from them:

Thank you for your recent enquiry.

During the term of the Newcastle Five Yea ISA, if you wish to transfer to another provider, this is possible providing you supply the society with 90 days notice.

If you keep the money invested for the full five years, and you move onto the maturity account, the maturity account will remain an ISA so as not to effect your tax free savings. You will be given the option to transfer or withdraw funds on maturity penalty free.

If you have any further queries please contact us on 0845 606 5522, our opening hours are 8am-8pm Monday - Thursday, 8am - 6.30pm Friday, 9am-5pm Saturday.

So transfers can be made provided you give 90-days notice. At maturity the account will remain an ISA.

Looks like a goer!

Steve_xx

Jonbvn wrote: »

I sent an online query to the Newcastle BS this morning regarding transfers and the status of the ISA at maturity.

This is the email I just got from them:

Thank you for your recent enquiry.

During the term of the Newcastle Five Yea ISA, if you wish to transfer to another provider, this is possible providing you supply the society with 90 days notice.

If you keep the money invested for the full five years, and you move onto the maturity account, the maturity account will remain an ISA so as not to effect your tax free savings. You will be given the option to transfer or withdraw funds on maturity penalty free.

If you have any further queries please contact us on 0845 606 5522, our opening hours are 8am-8pm Monday - Thursday, 8am - 6.30pm Friday, 9am-5pm Saturday.

So transfers can be made provided you give 90-days notice. At maturity the account will remain an ISA.

Looks like a goer!

I have asked similar questions of them and here is their response to me:

Thank you for your recent enquiry.

The Newcastle five year ISA requires 90 days notice on any transactions carried out during the term of the account. It is not possible to take the money and incur a loss of interest.

It is possible to transfer out to another ISA providing during the term. Transfers to other ISA's will also be subject to 90 days notice.

If you have any further queries please contact us on 0845 606 5522, our opening hours are 8am-8pm Monday - Thursday, 8am - 6.30pm Friday, 9am-5pm Saturday.

Yours sincerely,

NewcastleNet Savings.

Jonbvn

The same point about transfers is also mentioned in the Times.

http://www.timesonline.co.uk/tol/money/savings/article6564200.ece

harz99

Looks a good product then; shame no monthly income option though, so no use to me or any other pensioner who wants this facilty.

Seems we are stuck with Standard Lifes variable rate for now. Unless anyone knows different?

Nick_C

The only drawback I can think of, is if you are over 50 and want to deposit an additional £1500 in October, this account is likely to be unavailable then. But it seems like a good account for transfers in from previous years allowances.

Steve_xx

Nick_C wrote: »

The only drawback I can think of, is if you are over 50 and want to deposit an additional £1500 in October, this account is likely to be unavailable then. But it seems like a good account for transfers in from previous years allowances.

I think that you may be right in that it will not be available then. I feel that it is unlikely that Newcastle have though this through, regarding the extra £1500. I think that what they will do is to say that those with an account can add the £1500 to it at that point. That does not stop Newcastle from closing it to new applicants before October, but it would allow the full allowance to be deposited by those who do hold an account.

Aside from that it is fixed at 5% for five years, and even if you could not deposit the additional £1500 it would still be worth having if only for the guarantee in these troubled times.

JenHen

This is a tricky one if you can't stump up the cash immediately.

I just phoned Newcastle BS and they told me the following:

If you are planning to transfer in, get your transfer forms sent in as soon as possible and before the issue is closed to further investment (the guy I spoke to couldn't give any indication of when the issue would be likely to close but said it was dependent upon maximum investment limits). Transfers in must be received within 30 days of receipt of completed transfer forms and will be rejected if they take any longer than 30 days!

If you're investing this year's allowance for the first time - again, be quick! If, like me, you don't have the full whack to hand, you could end up in a situation where you've paid part of it in and the issue then closes and they won't allow you to top it up to the full £3600. The guy I spoke to said that, in this situation, they'd accept £3600 split between the 5-year ISA and another of their ISA products. Looking at the T&Cs/interest rates on their other ISAs, this might not be worthwhile.

Hmmm, debating what to do now...

Ifts

Think I will give this one a miss, as I said in post #10 additional deposits are not permitted after the account has been withdrawn, which is a shame otherwise would of prob gone for it. I'm sure other deals will come along soon hopefully!